JUDGMENT

KH. MUHAMMAD NASIM, J.—The captioned appeal has been directed against the judgment and decree of the High Court, dated 05.10.2022, passed in Civil Appeal No.197 of 2008.

2.    The precise facts of the case culminating into the filing of the instant appeal are that the Collector Land Acquisition vide award No.46/2006, finalized on 28.12.2006, acquired the land of the respondents, herein, measuring 8 kanal, 9 marla and 4 sarsai, situate in Mozia Ballah, Tehsil and District Mirpur, for Mangla Dam Raising Project, Mirpur. The compensation amount of the acquired land was assessed as Rs.5,25,000/- per kanal; along with 15% compulsory acquisition charges. Feeling aggrieved from the assessment of the Collector Land Acquisition, the respondents, herein, filed a reference application before the Reference Judge Mirpur, for enhancement of the compensation, alleging therein, that the acquired land according to its kind is ‘Maira Awal’, situated within the limits of the Municipal Corporation Mirpur and of commercial nature. It was further stated that while determining the compensation of the acquired land, the Collector Land Acquisition has ignored the relevant factors and also kept aside the fact that the Sector C/1 of Mirpur City is an integral part of Mozia Ballah, whereupon all the commercial buildings like Banks, Plazas and Hotels have also been constructed and owner of Nafees Bakers has purchased one marla land against the consideration of Rs.1,50,00,000/-. Lastly, it was prayed that the compensation of the acquired land may be fixed as Rs.1,00,00,000/- per kanal. The appellants, herein, filed objections on the reference application, whereby the claim of the landowners/respondents, herein, was refuted in toto. After necessary proceedings, the learned Reference Judge while answering the reference application in affirmative, enhanced the compensation to Rs.6,25,000/- per kanal, along with the 15% compulsory acquisition charges, vide judgment and decree dated 07.05.2008. Feeling dissatisfied from the enhancement made by the learned Reference Judge, the landowners/respondents, herein, filed an appeal before the High Court. After necessary proceedings, the learned High Court decided the appeal in the following terms:-

“The nutshell of the foregoing reasons is that while  accepting the appeal, the impugned judgment and decree dated 07.05.2008 of the learned Referee Court, Mirpur, is hereby modified in terms that the landowners/appellants, herein, are entitled to receive the compensation amount of Rs.23,95,848/- per kanal along with 15% Compulsory Acquisition Charges (C.A.C.) from the respondents. The respondents are directed to manage the payment of remaining compensation amount after deduction of the amount already paid within a period of three months from the date of announcement of the said judgment.”

The aforesaid judgment of the learned High Court has been challenged by the appellants herein by filing the instant direct appeal.

3. Mr. Javed Najam-us-Saqib, the learned Advocate, representing the appellants argued that the impugned judgment passed by the learned High Court is against law and the record of the case, which is not sustainable in the eye of law. He forcefully argued that the landowners failed to prove from documentary as well as oral evidence, that the value of the acquired land is more than the compensation assessed by the Collector. The learned Reference Judge while taking the lenient view already enhanced the reasonable amount and the learned High Court was not justified to further enhance the compensation amount. He zealously argued that in the instant case, the notification under section 4 of the Land Acquisition Act, 1894, was issued on 23.08.2005, whereas, the respondents, herein, in support of their claim produced the sale-deeds, dated 07.06.2000 and 04.02.2006, which were executed much prior to and after the issuance of the notification under section 4, therefore, the learned Reference Judge rightly discarded the said documentary evidence. He further argued that the learned High Court enhanced the compensation while relying upon the said sale-deeds, on the ground that this Court in the cases titled “Ch. Muhammad Siddique and others v. Azad Government and others” (Civil Appeal No.24 of 2010, decided on 15.07.2011) and “Muhammad Mehrban and another v. Azad Government and others” (Civil Appeal No.240, decided on 22.12.2016), while relying upon the said documents enhanced the compensation to the tune of Rs.23,95,848/- per kanal. He added that the reason assigned by the learned High Court is not justified as each case has its own peculiar facts and circumstances and keeping in view this fact, this Court while deciding the cases titled “Mazhar Hussain and others v. Collector Land Acquisition and others” (Civil Appeal No.25 of 2017, decided on 25.10.2017) and “Khanma Bi and others v. Collector Land Acquisition and others (Civil Appeal No.08 of 2018, decided on 24.04.2018) has refused to rely upon the sale-deeds dated 07.06.2000 and 04.02.2006. In this state of affairs, the impugned judgment passed by the learned High Court is against the settled principle of law and norms of justice, hence, is liable to be set aside. Lastly the learned Advocate, prayed for acceptance of appeal.

       4.    Conversely, Sardar Muhammad Azam Khan, the learned Advocate, representing the respondents, submitted that the impugned judgment passed by the learned High Court is legal and perfect in all aspects, hence, no interference by this Court is warranted under law. He forcefully argued that the acquired land is situated within the municipal limits and is in the heart of the Mirpur City and this fact is not denied by the appellants, herein. The landowners/respondents, herein, in support of their claim produced cogent evidence which remained unrebutted. The learned Reference Judge failed to appreciate the said evidence in a legal manner and enhanced very meager amount, however, on appeal the learned High Court after detailed deliberation of the evidence and keeping in view the potential value of the acquired land and its future utilization, has rightly fixed the compensation amount. The appellants, have failed to point out any illegality or infirmity committed by the learned High Court, therefore, this appeal merits dismissal.

5.    We have considered the arguments of the learned Advocates, representing the parties and gone through the record made available along with the impugned judgment. It is revealed from the record that the land owned by the respondents herein, measuring 8 kanal, 9 marla and 4 sarsai, situate at Mozia Ballah, Tehsil and District Mirpur, was acquired by the Collector Land Acquisition for Mangla Dam Raising Project, through award No.46/2006, dated 28.12.2006. The compensation amount of the acquired land was assessed as Rs.5,25,000/- per kanal, along with 15% compulsory acquisition charges. Feeling aggrieved from the assessment by the Collector, the respondents, herein, filed a reference application before the Reference Judge Mirpur, wherein they claimed the compensation amount as Rs.1,00,00,000/- per kanal. The learned Reference Judge while answering the reference application in affirmative, enhanced the compensation to Rs.6,25,000/- per kanal, along with the 15% compulsory acquisition charges, vide judgment and decree dated 07.05.2008. Feeling dissatisfied from the enhancement made by the learned Reference Judge, the landowners/respondents, herein, filed an appeal before the High Court. Through the impugned judgment the learned High Court has fixed the compensation amount as Rs.23,95,848/- per kanal, along with 15% compulsory acquisition charges.

6.    The record shows that the respondents, herein, in support of their claim produced Muhammad Hanif, Sher Alam and one of the respondents, Allah Ditta, also got recorded his statement. In addition to the oral evidence the respondents, herein, produced the documentary i.e. Exh. “PA” copy of the award, Exh. “PB”, the copy of the price assessed in the names of the respondents,  herein, Exh. “PC” the copy of sale-deed dated 07.06.2000 and Exh. “PD” the sale deed dated 04.02.2006, Exh. “PE” and “PJ”, the copies of the plots transferred in years 2005 and 2006. The trial Court discarded the documentary evidence, particularly the documents of sale-deeds on the grounds that the same were executed much prior to and after the issuance of the notification under section 4 of the Land Acquisition Act, 1894, enhanced the compensation amount Rs.6,25,000/- per kanal, along with 15% compulsory charges merely while relying upon the oral evidence, however, on appeal, the learned High Court fixed the compensation amount as Rs.23,95,848/-.

7.    Before proceeding further, it may be observed that the basic principle laid down by the apex Court of Pakistan and the apex Court of the State of Azad Jammu and Kashmir is that the land is not to be valued merely by reference to the use to which it is being put at the relevant willing time, but also by a reference to the use to which it is reasonably capable of being put in future; and the market value is the potential value of the property at the time of acquisition which would be paid by a buyer to a willing seller, when both are actuated by business principles prevalent in the locality at that time. The price of the land acquired had to be fixed in accordance with the aim and rule that willing buyer was ready to pay and willing seller was prepared to receive the price so fixed for whole of the land, had to be kept in view. Our, this view finds support from the case reported as Marawat Khan and 4 others v. Collector Land Acquisition, Mangla Dam Raising Project, Zone-I, Mirpur and 2 others [2013 SCR 1224], wherein, this Court observed in para 6 of the report as under:-

“6. Before proceeding further, it may be observed that the basic principle laid down by the apex Court of Pakistan and the apex Court of the State of Azad Jammu and Kashmir is that the land is not to be valued merely by reference to the use to which it is being put at the relevant time, but also by a reference to the use to which it is reasonably capable of being put in future; and the market value is the potential value of the property at the time of acquisition which would be paid by a willing buyer to a willing seller, when both are actuated by business principles prevalent in the locality at that time. The price of the Land acquired had to be fixed in accordance with the aim and rule that willing buyer was ready to pay and willing seller was prepared to receive the price so fixed for whole of the land, had to be kept in view. In this regard guidelines can be taken from a case titled Ch. Salam Din v. Azad Government of the State of Jammu and Kashmir through its Chief Secretary Muzaffarabad and 4 others 2001 MLD 204, in which it has been observe as under:–

“7. It is indeed correct that the sale-deeds of small portions of land are normally not a relevant consideration for enhancing the amount of compensation as they are used for commercial as well as residential purposes. In a case reported as Faiz Akbar Khan and others v. Azad Government and others [1996 SCR 132] it was observed by this Court as follows:-

‘It may be pointed out here that admittedly the land acquired is situated near Hajira Town, where the land can be also utilized for various commercial purposes. Even the learned counsel for the Government has argued that as the sale-deeds adduced in evidence by Faiz Akbar Khan and others pertain to the lands which were either purchased for the construction of shops or private buildings; the same are not good guide for assessing the market value of the Land in question. It may be pointed out that while assessing the market value, the land is not to be valued merely by reference to the use for which it was being made at the relevant time but also the use to which it can reasonably be put in future.’

Again in paragraph 9 of the above referred judgment it has been held as under:–

“9.    Even if we discard the evidence of sale-deeds relating to small portions of land to form basis for enhancement of compensation, we may point out that it has been held by this Court in numerous cases that the potential value of the land acquired to which it can be put into use in future and the locality of land where it is situated are some of the relevant considerations for determining the market value of the land. In our considered view the trial Court advanced cogent reasons in determining the market value of the land by observing that acquired land was situated on Neelum Valley road and because of its location and the potential use to which it can be put into in future. The trial Court relied upon the evidence of witnesses who were unanimous on the point that the land acquired was situated adjacent to Pattikha Bazar and was of better quality than the land situated at Balsary. In the judgment passed by the District Judge, Ex.PA, the land was acquired in 1988 but the compensation amount was enhanced to the tune of Rs.56,000/- per kanal. The trial Court also observed that the sale-deeds Ex. PC and PE were executed in 1983 and 1993 respectively sale-deed Ex. PD was executed on 27.12.1987. Since these sale-deeds were executed prior to the acquisition of the land therefore they could be considered for determining the market value of land in question but as observed earlier even if we discard the sale-deeds of small portions of land for determining the market value of land in question there is other sufficient material on record; i.e., the judgment of the District Judge, Ex.PA, the findings recorded by the trial Court that the land in question was situated on the Neelum Valley road and it had the potential to be put into a better use in future. Moreover, all the witnesses produced by the appellant were unanimous on the point that the land in question was situated on the road side near Pattika Bazar. The above evidence was further supported by the statement of Ch. Salam Din, appellant, himself that he wanted to utilize the land in question for commercial use and for that purpose he had even raised the construction of some shops which shows that the market value fixed by the trial Court suffers from no illegality or infirmity as pointed out by the learned Counsel for the respondents.”

The apex Court of Pakistan has elaborately laid down the criteria for determination of compensation in a case reported as Murad Khan through his widow and 13 others v. Land Acquisition Collector, Peshawar and another [1999 SCMR 1647] in the following terms:-

“13. Section 23 of the Act, lays down by way of criterion, that ‘market value’ of land on the date of publication of notification under section 4(ibid) would be the amount of compensation. The expression ‘market value’ has not been defined in the Act. But there is considerable case-law on the point encompassing the period of about time decades in which the expression in question has come to assume almost definite meaning. In this judgment we would, however, refer to number of important cases in which the expression ‘market value’ occurring in section 23 (ibid) has been judicially construed by various High Courts and even the Supreme Court of Pakistan. According to these judgments the following matters are to be taken into consideration in determining the amount of compensation:-

(i) The data from which the market value of the land can be estimated is given in Rule 13 of the North-West Frontier Province Circular No. 54 issued presumably under section 55 of the Act.

(ii) The best method to work out the market value is the practical method of a prudent man laid down in Article 2, Qanun-e-Shahadat, 1984 to examine and analyze all the material and evidence available on the point and to determine the price which a willing purchaser would pay to willing seller of the acquired land.

(iii) Subsection (1) of section 23 of the Land Acquisition Act provides that in determining the amount of compensation the Court shall take into consideration the market value, loss by reason of severing such land from his other land, acquisition injuriously affecting his other property or his earning in consequence of change of residence or place of business and damage, if any, resulting from diminution of the profits of the land between the time of the publication of the declaration under section 6 and the time of the Collector’s taking possession of the land. This, however, is not exhaustive of other injuries or loss which may be suffered by an owner on account of compulsory acquisition.

(iv) The best method of determination of the market price of the plots of land the acquisition is to rely on instances of sale of it near about the date of notification under section 4(1) of the Land Acquisition Act. The next best method is to take into consideration the instances of sale of the adjacent lands made shortly before and after the notification. When the market value is to be determined on the basis of the instances of sale of land in the neighboring locality, the potential value of the land need be separately awarded because such sales cover the potential value.

(v) It is obvious that the law provides determination of not with reference to classification or nature of land but its market value at the relevant time. No doubt, for determining the market value, classification or the nature of land may be taken as relevant consideration but that is not the whole truth. An area may be Banjar Qadeem or Barani but its market value may be tremendously high because of its location, neighborhood, potentiality or other benefits.

(vi) According to well-settled principle, while determining the value of the compensation the market value of the land at the time of requisition/acquisition and its potentiality have to be kept in consideration.

(vii) Consideration should be had to all the potential uses to which the land can be put, as well as all the advantages, present or future, which the land possesses in the hands of the owners.

(viii) In determining the quantum of fair compensation the main criterion is the price which a buyer would pay to a seller for the property if they voluntarily entered into the transaction.

(ix) The measure of fair compensation is the value of the property in open market which a seller voluntarily entering into a transaction of sale can reasonable demand from a purchaser this means that Court has to determine the value of the land in the open market at the relevant time on the assumption that the notification of acquisition did not exist.”

(x) While determining the value of the land acquired by the Government and the price which a willing purchaser would give to the willing seller, only the ‘past sales’ should not be taken into account but the value of the land with all its potentialities may also be determined by examining (if necessary as Court witness) local property dealers or other persons who are likely to know the price that the property in question is likely to fetch in the open market. In appropriate cases there should be no compunction even relying upon the oral testimony with respect to market value of the property intended to be acquired, because even while deciding cases involving question of life and death, the Courts rely on oral testimony alone and do not insist on the production of documentary evidence. The credibility of such witnesses would, however, have to be kept in mind that it would be for the Court in each case to determine the weight to be attached to their testimony. It would be useful and even necessary, to examine such witnesses while determining the market prices of the land in question, because of the prevalent tendency that in order to save money on the purchases of stamp papers and to avoid the imposition of heavy tax levied on sale of property, people declare or show a much smaller amount as the price of the land purchased by them than the price actually paid. The ‘previous sales’ of the land, cannot, therefore, be always taken to be an accurate measure for determining the price of land intended to be acquired.

(xi) The sale-deed and mutation entries do serve as an aid to the prevailing market value.

(xii) It is a well-settled law that in cases of compulsory acquisition effort has to be made to find out what the market value of the acquired land was or could be on the material date. While venturing the most important factor to be kept in mind would be the complexion and character of the acquired land on the material date. The potentialities it possessed on that date are also to be kept in view in determining a fair compensation to be awarded to the owner who is deprived of his land as a result of compulsory acquisition under the Act.

(xiii) The value of the land of adjoining area which was simultaneously acquired and for which different formula of compensation has been adopted should be taken into consideration.

(xiv) The phrase ‘market value of the land’ as used in section 23(1) of the Act means ‘value to the owners’ and, therefore, such value must be the basis for determination of compensation. The standard must be not a subjective standard but an objective one. Ordinarily, the objection standard would be the price that owner willing and not obliged to sell might reasonably except to obtain from a willing purchase. The property must be valued not only with reference to its condition at the time of the determination but its potential value must be taken into consideration.”

In another case titled Province of Punjab through Collector, Attock v. Engr. Jamil Ahmed Malik and others [2000 SCMR 870], it has held as under:-

“16.  In the case of Province of Punjab through Collector, Bhawalpur and others v. Col. Abdul Majeed and others (1997 SCMR 1692), the following principles of law were laid down for assessing the future prospects of the land acquired under the Land Acquisition Act, 1894 in terms of section 23:-

(i) That an entry in the Revenue Record as to the nature of the land may not be conclusive, for example, land may be shown in Girdawari as Maira, but because of the existence of the well near the land, makes it capable for becoming Chahi land.

(ii) that while determining the potentials of the land, the use of which the land is capable of being put, ought to be considered.

(iii) That the market value of the land is normally to be taken as existing on the date of publication of the notification under section 4(1) of the Act but for determining the same the price on which similar land situated in the vicinity was sold during the preceding 12 months and not 6-7 years back may be considered including other factors like potential value etc.”

Similar view prevailed in the cases titled Sardar Abdul Rauf Khan and others v. The Land Acquisition Collector/Deputy Commissioner Abbottabad and others [1991 SCMR 2164] and Market Committee, Kanganpur through Administrator v. Rayyat Ali and others [1991 SCMR 572].”

In the instant case, the witnesses produced by the respondents unanimously stated that the acquired land is located within the municipal limits, is of commercial nature and its market value is more than the price assessed by the Collector. In documentary evidence, the respondents, herein, produced Exh. “PC”, the sale-deed, dated 07.06.2000, whereby the land measuring 11 marla, was sold against the consideration of Rs. 15,00,000/- and Exh. “PD”, the sale deed dated 04.02.2006, through which the land measuring 2 kanal, 3-1/2 Malra was transferred against the consideration of Rs.47,50,000/-. The learned Referee Judge has not given any weight to the sale-deeds, referred to above on the ground that the same were executed prior to and after the issuance of notification under section 4 of the Land Acquisition Act. We are not convinced with the finding recorded by the trial Court as the sale-deeds which were executed prior to the issuance of the notification under section 4 cannot be turned down merely because they were executed a long time prior to the acquisition of the land in question. If the price of land sold five years prior to the issuance of notification under section 4 of the Land Acquisition Act was so high, then how the price of the land in question can be assessed lesser than the price prevailing five years prior to issuance of notification, especially so when the acquired land is situated in the heart of the city. Same like, the sale-deed executed on 04.02.2006, has also not been considered by the Collector as well as the Reference Judge on the ground that the same was executed after issuance of the notification under section 4 of the Land Acquisition Act. In the case in hand, the notification under section 4 of the land Acquisition Act, was issued on 23.08.2005, whereas, the award was issued on 28.12.2006. In this way, the sale-deed dated 04.02.2006, was executed after the issuance of notification under section 4 and prior to the issuance of the award which can also be considered for determining the market value of the acquired land. In our estimation, the Collector as well as the learned Reference Judge was not justified to discard the sale deeds discussed, hereinabove.

8.    So far as the argument of the learned Advocate, representing the appellants, that the learned High Court was not justified to rely upon the sale-deeds dated 07.06.2000 and 04.02.2006, on the ground that the same sale-deeds were produced in the cases titled “Mazhar Hussain and others v. Collector Land Acquisition and others” (Civil Appeal No.25 of 2017, decided on 25.10.2017) and “Khanma Bi and others v. Collector Land Acquisition and others (Civil Appeal No.08 of 2018, decided on 24.04.2018) and this Court refused to enhance the compensation on the basis of said sale-deeds, is concerned, the same has no substance because it is transpired from the record that the learned Court has enhanced the compensation amount while relying upon the said sale-deeds on the strength of the full Court judgment of this Court delivered in the case titled Ch. Muhammad Siddique and others v. Govt. and others (Civil Appeal No.24 of 2010, decided on 15.07.2011) and the judgment delivered in Muhammad Mehrban’ case. The appellants have failed to point out any illegality or infirmity committed by the learned High Court, hence, calling no interference by this Court.

The nutshell of the above discussion is that finding no force in this appeal, the same is hereby dismissed. No order as to costs.

Appeal dismissed.